With the recent release of S/4HANA 1709 SAP customers are now able to run SAP Transportation Management functionality on the same instance as their ERP solution. Such option certainly looks very appealing, as it reduces the complexity of several interfaces and data duplication. However, the embedded SAP TM alternative has its limitations that are important to understand and take into consideration.

We have compiled a number of frequently asked questions and answers in regard to embedded TM offering in SAP S/4HANA and published them for your reference below. Please note that the information provided below is accurate as of the writing of this post (January 2018) and relates to S/4HANA version 1709.

What is "embedded TM" in SAP S/4HANA?

S/4HANA 1709 introduced an additional deployment option for SAP Transportation Management where TM functionality runs side-by-side on the same S/4HANA instance as the ERP functionality. In other words, it is no longer necessary to have a separate set of systems/servers/databases for SAP Transportation, as is the case with the classic side-car deployment option of SAP TM that we have seen to date.

What SAP TM version is the embedded option in S/4HANA based on?

Generally speaking, the embedded option is based on SAP TM 9.5 with a few restrictions (see more below).

Does S/4HANA embedded TM support both Shipper and LSP scenarios?

No. Currently embedded TM option only supports the Shipper scenario. LSP support is planned in a future release.

What are the main advantages of the embedded TM option?

The main advantages can be summarized as follows:

Smaller database and hardware footprint

Reduction in Total Cost of Ownership (TCO) due to smaller replication and monitoring effort

Remove the need to duplicate ERP customer, vendor and material master data into business partners and products in TM, thereby removing the need for the Core Interface (CIF). ERP and TM share a single set of harmonized master data objects.

Real-time embedded analytics

Integration with new S/4HANA Enterprise Management for managing transportation-related equipment

Remove the need to duplicate ERP orders and deliveries into Order-based Transportation Requirement (OTR) and Delivery-based Transportation Requirement (DTR) documents in TM. OTR and DTR documents are no longer necessary. Orders and deliveries are able to convert directly into Freight Units, Freight Orders, etc.

What SAP licensing is required for embedded SAP TM functionality in SAP S4/HANA?

As always, please contact your SAP Account Executive to get the most accurate information. But here is a high-level overview of what the licensing normally looks like:

S/4HANA divides TM functionality into 2 main buckets - Basic Shipping and Supply Chain for Transportation Management (SC for TM). As the name implies, Basic Shipping includes basic transportation functionality, whereas SC for TM includes advanced TM functionality. Basic Shipping functionality is included in the "Digital Core" licensing of S/4HANA which basically means that no additional licensing is required. However, SC for TM is a separately licensed SAP product that does require additional licensing to be purchased.

What is included in Basic Shipping in S/4HANA?

Technically, Basic Shipping was introduced in S/4HANA with release 1511. However, back then Basic Shipping was based purely on the old ECC Logistics Execution - Transportation (LE-TRA) functionality, utilizing ECC shipments and shipment documents. Implementing such functionality is strongly discouraged, as it is based on highly outdated code base and already subject to end of life of the Compatibility Scope, which is currently set to 2025.

S/4HANA 1709 brought the possibility of implementing Basic Shipping functionality using the modern SAP TM code base. The following basic functions are included:

Main transportation network master data (zones, lanes, etc.)

Manual carrier selection and tendering

Freight agreements

Delivery based planning

Dangerous goods management (with some limitations)

Output management

Transportation execution (without Event Management)

Basic charge calculation and freight settlement

Analytics in BW

As a general guideline, SAP customers are able to perform the same functions that they could using the old LE-TRA shipment/shipment cost document functionality, but utilizing the new SAP TM objects, transactions and code base. However, if the functionality was not included in the scope of the old LE-TRA solution it is likely not covered by Basic Shipping in S/4HANA either.

What advanced functionality is covered by S/4HANA Supply Chain for Transportation Management (SC for TM)?

SC for TM adds a wide range of functionality on top of Basic Shipping that some SAP customers have already experienced in side-car SAP Transportation Management offering:

What key SAP TM functionality is not yet available in the embedded TM option in S/4HANA?

There are a number of key limitations in the current embedded TM offering in S/4HANA 1709. First of all, as mentioned before, the LSP scenario is not yet covered and thus the following functionality is currently missing:

Forwarding orders

Forwarding settlement

The current lack of Forwarding Order support is especially important to note as in our experience many of the Shippers (not just LSPs) rely on Forwarding Orders to cover business scenarios that are not based on ERP orders and deliveries.

In addition, the following functionality is currently not supported in S/4HANA SC for TM:

TM Order Scheduling (ability to integrate TM planning during Available-to-Promise check in the sales order)

Condition-based filtering in selection profiles

Integration with SAP CRM

Can existing side-car SAP TM customers move to S4/HANA SC for TM?

Technically, the answer is yes. And SAP will even work with you to provide a credit for your original SAP TM licensing and convert that to S/4HANA SC for TM licensing. However, currently there are no standard SAP tools to help with the conversion effort, which means that such conversion can potentially involve a fairly significant effort. It is worth noting that SAP is supposedly considering building some standard migration tools in the future.

Do you still need to install the Optimizer executable separately from SAP TM or is it included in the S/4HANA environment?

In S/4HANA SC for TM the Optimizer executable is still a separate engine that has to be installed in the same manner as it was installed for the side-car SAP TM offering.

Is SAP Event Management (EM) embedded in S/4HANA 1709?

No. SAP EM is not embedded in S/4HANA, does not integrate with S/4HANA and is not planned to be integrated in the future. Instead, SAP EM will be replaced with the new SAP Global Track and Trace (GTT) public cloud solution in the near future.

Is embedded TM available in the S4 Public Cloud offering?

Not currently. SAP has a long-term plan to bring embedded TM to S4 Public Cloud.